ORGANIZATIONALBEItAVIOR AND I-IUiVIA~ PERFOR1V[AI~CE 8~ 217--229
(1972)
The Effects of Contingent and Noncontingent Rewards
and Controls on Intrinsic Motivation
EDWARD L. DECI 1
University o/ Rochester
Theories of management and work motivation distinguish between two
kinds of rewards--extrinsic and intrinsic. Extrinsic rewards are ones such as
money and verbal reinforcement which are mediated outside of the person,
whereas intrinsic rewards are mediated within the person. We say a person
is intrinsically motivated to perform an activity if there is no apparent reward except the activity itself or the feelings which result from the activity.
All of the theories of work motivation which consider both kinds of rewards
assume that the effects of the two are additive. This paper examines that
assumption by reviewing a program of research which investigaied the effects of external rewards and controls on intrinsic motivation. I t was reported
that a person's intrinsic motivation to perform an activity decreased when
he received contingent monetary payments, threats of punishment for poor
performance, or negative feedback about his performance. Noncontingent
monetary payments left intrinsic motivation unchanged, and verbal reinforcements appeared to enhance intrinsic motivation. A cognitive evaluation
theory was presented to explain these results, and the theory and results
were discussed in relation to management.
Since t h e a d v e n t of scientific m a n a g e m e n t ( T a y l o r , 1911), p i e c e - r a t e
p a y m e n t s (or wage incentives) h a v e been c o m m o n l y used for m o t i v a t i n g
e m p l o y e e s . Such s y s t e m s (which d a t e b a c k to p r e i n d u s t r i a l t i m e s ) tie a
p e r s o n ' s financial r e w a r d s d i r e c t l y to his p e r f o r m a n c e b y p a y i n g h i m a
set r a t e for each u n i t of o u t p u t which he produces. T h e m o t i v a t i o n a l ass u m p t i o n u n d e r l y i n g p i e c e - r a t e p a y m e n t s - - a s well as sales commissions,
bonus plans, e t c . - - i s t h a t a person will p e r f o r m effectively to the e x t e n t
t h a t his r e w a r d s are m a d e c o n t i n g e n t u p o n effective p e r f o r m a n c e (cf.
V r o o m & Deci, 1970).
T h e r e is c o n s i d e r a b l e s u p p o r t in t h e p s y c h o l o g i c a l l i t e r a t u r e for this
assumption about motivation. The behaviorists have substantiated and
refined t h e L a w of Effect ( T h o r n d i k e , 1932), which s t a t e s s i m p l y t h a t
1The ideas in the introduction of this paper draw heavily on Vroom and Deci
(1970). I am indebted to Victor Vroom for his ideas and collaboration. I would like
to thank John Miller for making helpful comments on an earlier draft of the manuscript, and Wayne Caseio, Larry Coff, Jim Gould, and Stanley Kaplan for assistance
in da~a collection.
217
Copyright © 1972 by Academic Press, Inc.
All rights of reproduction in any form reserved.
218
EDWARD L. DECI
when a response is followed by a reinforcement it will have an increased
probability of recurrence. Piece-rate payments presumably reinforce the
response of producing output and should, therefore, strengthen that
response.
The use of piece-rate payments can also be defended by the psychological literature on expectancy theories of motivation (e.g., Vroom, 1964;
Atkinson, 1964). The underlying assumption in these theories is that
man's behavior is goal directed (Tolman, 1932) ; in other words, man will
engage in behavior which he believes will lead him to desired end states.
Hence, if someone is working for piece-rate payments, one might expect
that he would produce efficiently in order to get substantial wages.
For this motivational system to work effectively, it is necessary that
there be clear standards for performance which the workers understand.
Then, performance has to be monitored, and rewards must be administered consistently. Further, the output must be quantifiable so that performance can be measured, and jobs should be relatively independent so
that a worker has control of his own production rate (for more detail on
this, see Vroom & Deci, 1970).
This approach to employee motivation utilizes externally mediated rewards, i.e., rewards administered by someone other than the employee
himself. In so doing, the management is attempting to control the employee's behavior so he will do what he is told, in the way and in the
amount that he is told.
Although this system seems to have advantages for motivating employees, there are also many limitations to it. Perhaps the most serious is that
only certain kinds of reinforcements can be externally mediated. These
are tangible rewards including money, promotions, and fringe benefits, as
well as verbal or social reinforcements. These rewards can satisfy what
Maslow (1943, 1970) has called "lower-order" needs; however, they do
not take account of "higher-order" needs for self-esteem and self-actualization (Maslow, 1943, 1970). Many studies have reported that employees
consider higher-order needs to be important (e.g., Morse & Weiss, 1955)
and that there is a positive relationship between opportunity for self-expression and job satisfaction (Vroom, 1962). It follows then that there
are many important motivators of human behavior which are not under
the direct control of managers and, therefore, cannot be contingently administered in a system of piece-rate payments.
More recent approaches to management (e.g., Likert, 1961; Argyris,
1957; McGregor, 1960) have assumed that man can be intrinsically motivated to perform effectively; that is, they assume that individuals can
be motivated by the job itself and can derive satisfaction from doing the
job well. These approaches focus on higher-order needs where the rewards
EFFECTS
OF REWARDS AND CONTROLS ON !V[OTIVATION
219
are mediated by the person himself, and they stress the importance of
getting the worker ego-involved in his work and committed to doing it
well.
There are two essential aspects to motivating employees intrinsically.
The first involves designing tasks which are interesting and which necessitate creativity and resourcefulness--what White (1959) calls "effeetance" motivation--and the second involves allowing workers to have
some say in decisions which concern them so they will feel like causal
agents in the activities which they engage in. DeOharms (1968) has suggested that man has a need for feelings of personal causation and that
the essence of intrinsic motivation is a feeling of free choice and
commitment.
The newer participative management theories suggest several means
of eliciting intrinsic motivation. Employee participation in decision
making is stressed as a means of getting employees more ego-involved.
The employees are given a voice in decisions which affect them, and they
are given greater latitude in the way they do their jobs. There is less reliance on authority as a control mechanism, and employees are judged
by their results. These newer theories also suggest that jobs should be
enlarged or enriched so as to be more challenging (cf. Myers, 1970; Lawler, 1969). Leavitt (1962) has suggested that challenging jobs may be
even more important than allowing participation in decision making,
though the most intrinsically motivating jobs are the ones which have
both.
These theorists believe that participative management is the most elfeetive way of achieving high performance (e.g., Likert, 1961) and also
more conducive to mentally healthy employees (e.g., Maslow, 1965).
There are some experimental results which substantiate that organizations which have implemented these practices are more productive and
have higher levels of employee satisfaction (Likert, 1967; Marrow,
Bowers, & Seashore, 1967). Further, Kornhauser (1965) found that there
is a positive relationship between employees' reports of the degree to
which they get to use their special abilities on the job and strong mental
health.
Most theories of work motivation (e.g., Porter & LaMer, 1968) assume
that the effects of these two kinds of rewards--intrinsic and extrinsic-are independent, or additive. This suggests, therefore, that work should
be structured to arouse intrinsic motivation and also that workers should
be rewarded extrinsically (and contingently) for doing well. It now seems
appropriate to examine this assumption of the additivity of the effects of
the two kinds of rewards. Are piece-rate payments or other extrinsic reward systems which tie rewards (especially money) to performance corn-
220
EDWARD L. DECI
patible with participative management, which focuses on intrinsic motivation? That is, will a person's intrinsic motivation to do a job remain
unaffected by external rewards?
Two recent papers (Deci, 1971, 1972) have presented evidence that
when money was paid to subjects for performing intrinsically motivated
activities, and when that money was made contingent on their performance, they were less intrinsically motivated after the experience with
money than were subjects who performed the same activity for no pay.
The first paper (Deci, 1971) presents two studies which investigated
the effects of contingent payments on intrinsic motivation. The first was
a laboratory study in which each subject participated in three one-hour
sessions of puzzle-solving. Pilot testing substantiated that the puzzles
were indeed intrinsically motivating. Both the experimental group and
control group did the same activity (viz., attempt to solve four puzzles)
during each of the three sessions. The only difference between the two
groups was that the experimental subjects were paid one dollar per
puzzle solved during the second session. During each of the three sessions,
subjects were left alone in the experimental room for an eight minute
"free choice" period. They could work on the puzzles, read magazines, or
do whatever they liked, so it was reasoned that if they worked on puzzles
when there was no apparent reward and when there were other things to
do then they must be intrinsically motivated to perform the activity.
Comparisons were then made between the experimental and control groups
on the amount of free choice time they spent working on the puzzles in
the first and third sessions. The results indicated that there was a significant decrease in the experimental subjects' intrinsic motivation from
sessions I to I I I relative to the controls' intrinsic motivation. In other
words, the experimental subjects had lost intrinsic motivation (i.e., they
spent less free choice time working on the puzzles) as a result of their
experience of doing the activity for pay.
These results were replicated in a controlled field experiment (Deei,
1971) which took place over a 16-week period in a college newspaper.
Subjects were staff members who wrote headlines for the college newspaper and who were unaware that an experiment was being performed.
As in the laboratory study, subjeets who were paid for their performance
($.50 per headline written) showed a decrease in intrinsic motivation
which was evident as much as eight weeks after the payments had
stopped.
The results were again replicated in another laboratory study (Deci,
1972) using a somewhat different experimental paradigm. This general
paradigm will now be described in some detail since it was used in several
EFFECTS
Oil' REWARDS AND C O N T R O L S O N M O T I V A T I O N
221
investigations, including one which provided data that will be presented
for the first time in this paper.
GENERAL PARADIGM
Each subject participated for a one-hour session during which he spent
most of his time working on a puzzle called Soma. The puzzle is composed
of seven different pieces, each of which is made to look like it is three or
four one-inch cubes. The pieces can be fitted together to form millions of
configurations--only a few of which were used for these experiments.
During a session, the subject was asked to reproduce either three or four
configurations which had been drawn on paper for him. The time to complete each configuration was measured with a stop watch, and if a subject were unable to do a configuration within ten minutes he was stopped
and told how to do it. This let him know that all the configurations were
possible.
When a subject reported to the waiting room he was met by the first
experimenter who took him to the experimental room where he was seated
at a table. The experimenter then left through a door at the back of the
experimental room so that he would be outside the room observing through
a one-way window. The subject knew of course that the experimenter
was observing him, and he communicated with the experimenter through
an intercom.
On the table in front of the subject were the seven puzzle pieces--each
with a number on it so that the experimenter could refer to it over the
intercom. To the left of the subject was a stack of the configurations that
he would be asked to reproduce. To his right were three other configurations. The top one of the three was a sample; the other two will be discussed below. On another table to the subject's right were the microphone,
speaker, recent issues of three magazines (New Yorker, Time, and Playboy), and an ashtray.
When the experimenter got to his position behind the one-way window,
he read the instructions to the subject. The subjects were told that this
was a study of certain problem-solving concepts, and that they would be
asked to solve either three or four puzzle problems (depending on which
experiment it was). After the instructions were read, the experimenter
told the subject to look at the sample to his right, told him how it could
be solved, and allowed about a minute for him to manipulate the pieces
and solve it. The subject then worked on the puzzles in turn.
In each of the experiments, the experimental manipulation was made
during this puzzle-solving period. Subjects were in one of the following
conditions: they were rewarded with money, either contingently or non-
222
EDWARD L. DECI
contingently; they were threatened with punishment for poor performance;
they were given either positive or negative feedback about their performance; or they were control subjects who received no reinforcements, either
positive or negative.
To obtain the dependent measure of motivation, the experimenter left
his position for a period of eight minutes following the puzzle solving.
The pretext was as follows: When a subject had completed the four puzzles, the experimenter said that he had done all the problem solving which
he had to do, but there was one more thing which he would be asked to
do, and that was to complete a short questionnaire. Since it was an experiment in problem solving, the subject would be asked a few questions
about the way he had solved the puzzles. However, there were four different sets of questions, only one of which would be the most appropriate
for this subject and that would be determined by how he had done on
the puzzles. To select the appropriate set of questions, data from the
session would be fed into a computer through a teletype. To do this, the
experimenter would have to leave for a short time, five to ten minutes.
The subject was told that he could do anything that he liked during that
time, but he was asked to stay in the room. The experimenter left his position and entered the experimental room through the back door and exited
through the front door. He then climbed a small set of steps outside the
room and left the lab area through a door at the top of the stairs. The
subject still in the experimental room could hear him climb the stairs and
open and close the door.
As the first experimenter left the room, he signalled to a second experimenter to go to the outside of the one-way window to observe the subject.
The second experimenter got to his position behind the one-way window
through a different door which the subjects did not know existed, and
there was no indication that the subiects suspected they were being ohserved during this "free-choice" period.
Hence, the subject was alone in the room and was unaware that he
was being observed, so he was free to work on the puzzles, read magazines,
or do anything he liked. Intrinsic motivation to perform the task was
assumed to be reflected in the amount of time out of the eight minutes
which he spent working on the puzzles. It was reasoned that if he worked
on the puzzles during this free-choice time when he could do other things,
then he must be intrinsically motivated to do the activity. The amount
of time out of the eight minutes which the subject spent working on the
puzzle was determined by the second experimenter who used a stop watch
to record the time. The second experimenter was blind to the condition
and to the hypotheses of the experiments.
Since any subject who was unable to do a configuration within the ten
EFFECTS
OF REWARDS AND COI~TROLS ON M O T I V A T I O N
223
minutes allowed was told the solution and allowed to do it, the possibility
that the Zeigarnik (1927) effect would influence whether or not he worked
on the puzzle in the eight-minute free choice period was minimized.
The configurations whose drawings were in the pile to his right under
the sample during the entire experiment were impossible ones to do. This
precluded the possibility that a subject would finish a configuration during the free-choice period and have that be a causal factor in determining
whether or not he continued working on the puzzle.
After eight minutes, the first experimenter returned to the room and
asked the subjects to complete the questionnaire.
RESULTS AND THEORY
As mentioned earlier, using this paradigm Deci (1972) replicated the
finding that subjects who were paid one dollar per puzzle solved showed
a decrease in intrinsic motivation.
Further, Deci and Caseio (1972) reported that when subjects were
threatened with punishment for poor performance, their intrinsic motivation also decreased. These experimental subjects were told that if they
were unable to solve a puzzle within the ten minutes allotted, a buzzer
would sound indicating that their time was up. They were then given a
brief exposure (about one second) to the buzzer so they would know that
it was truly noxious. Hence they were performing because they were intrinsically motivated and because good performance would allow them to
avoid a punishment (the buzzer). The results indicated that those who
solved puzzles under threat of punishment were less intrinsically motirated during the free-choice period than subjects who solved the same
puzzles with no threat of punishment.
Deci has suggested a cognitive evaluation theory to explain this change
in intrinsic motivation. It concentrates on a person's perception of why
he is doing the activity. When he is intrinsically motivated, the perceived
locus of causality (Heider, 1958) of that behavior is within himself. He
is doing it because it provides him with some sort of internal satisfaction.
However, when he performs the activity for external reinforcements such
as money, he comes to perceive that he is doing it for the money. The
perceived locus of causality changes from within himself to the environment; that is, he cognitively reevaluates the activity as one which he does
because it provides him with external rewards. In other words, the first
process by which intrinsic motivation can be affected is a change in perceived locus of causality.
On the other hand, Deei (1971, 1972) has reported that verbal reinforcements do not decrease intrinsic motivation; in fact, they appear to
enhance it. In the Deci (1971) study, the three-session paradigm described
224
EDWARD L. DECI
earlier was used. In this study, the experimental subjects were rewarded
with verbal statements such as, "That's very good, it's the fastest anyone
has solved this one," each time they solved a puzzle. The control group
received no rewards. The results indicated that subjects who received
verbal rewards were more intrinsically motivated following that experience than subjects who received no rewards. These results were replicated
for males (Deci, 1972) using the one-session methodology described above.
The essential difference between money and verbal rewards is that
verbal rewards may not be phenomenologically distinguishable from the
feelings of satisfaction which the person gets for doing the activity. Hence,
the verbal reinforcements strengthen his intrinsic motivation because they
provide additional positive value which becomes associated with the activity; so the subiect is more likely to perform the activity in the absence
of external rewards. According to the cognitive evaluation theory then,
the second process by which intrinsic motivation can be affected is that
of feedback. Positive feedback increases the total positive value properties (Koch, 1956) associated with the activity by strengthening the person's sense of competence and self-determination. This makes him more
intrinsically motivated £o perform the activity.
In another experiment using the one-session paradigm, Deci and Cascio
(1972) showed that negative feedback resulting from bad performance on
an intrinsically motivated activity caused a decrease in intrinsic motivation. According to the cognitive evaluation theory, the psychological
process underlying this decrease is the same as the process by which positive feedback enhanced intrinsic motivation. The negative value associated with the failure and the resulting threat to the person's sense of
competence offsets some of the positive value associated with the activity,
thereby causing a decrease in intrinsic motivation.
It was suggested (Deci & Cascio, 1972) that the relation between feedback and intrinsic motivation may not be monotonic. With positive feedback, if there is too much feedback, the person may become dependent
on it just as he becomes dependent on money, and this would lead to a
decrease in intrinsic motivation. Further, too much positive feedback could
cause the person to perceive that he is being ingratiated (Jones, 1964),
and this would also lead to a decrease in intrinsic motivation. With negative feedback, a very small amount could serve as a challenge to the person, making him more intrinsically motivated. However, when there is
enough negative feedback to threaten his sense of competence and selfdetermination, it will lead to a decrease in intrinsic motivation.
Interpreting these results in relation to theories of work motivation, it
seems clear that the effects of intrinsic motivation and extrinsic motivation are not additive. While extrinsic rewards such as money can certainly
EFFECTS OF REWARDS AND CONTROLS ON MOTIVATION
225
motivate behavior, they appear to be doing so at the expense of intrinsic
motivation. As a result, contingency payment systems do not appear to
be compatible with participative management systems. Likert (1967, p.
113) has stated, "Basing the compensation of a manager of a profit center
largely upon his performance has much to commend it . . . . " While this
could certainly motivate the manager, it could also inferrer with his intrinsic motivation, which is an integral part of Likert's System 4
management.
Given these results, it becomes interesting to ask whether it is the money
per se, or the money administered contingently which causes the decrease
in intrinsic motivation. The next experiment was designed to investigate
that question. Does money affect intrinsic motivation when it is administered for an activity in a way that is not contingent upon performance?
The general paradigm employed in this study was the one-session
paradigm described in detail above. The subjects in the experimental
group were told that they would be paid $2 for participating in the experiment since there were research funds available for paying subjects,
and they would receive the money in cash at the end of the experiment.
The control subjects did exactly the same thing as the experimental subieets except that there was no mention of money to the controls.
The control condition in this experiment was identical to that in the
Deei (1972) experiment. The experimental condition was also the same
as the "money only" condition in the previous experiment except that in
the previous experiment subjects were paid $1 for each puzzle they solved
(out of four) whereas in this experiment each subject received $2 regardless of performance. The critical difference then is that the money paid
to experimental subjects in this experiment is not contingent on performanee whereas it was in the previous study. The control groups in the two
experiments were treated identically, although the experimenter was different in the two experiments.
Table 1 presents the experimental data. Subieets in the control eondiTABLE 1
I~UMBER OF SECONDS SPENT BY EXPERIMENTAL AND CONTROL SUBJECTS
WORKING ON THE PUZZLES I)URING THE EIGHT-MINUTE
~~REE-CHoICE ~ PERIOD
Control
Experimental
Noncontingent payment study
190.2
n = 16
192.8
n = 24
C o n t i n g e n t p a y m e n t study, Deci (1972)
208.4
n = 16
108.6
n = 16
226
EDWARD L. DECI
TABLE 2
A SUMMARY OF THE EFFECTS OF VARIOUS EXTERNAL I=~EWARDS AND
CONTROLS
ON INTRINSIC
MOTIVATION
External reward or control
Contingent monetary payments
Noncontingent monetary payments
Threats of punishment
Positive feedback
Negative feedback
Effect o n intrinsic motivation
Decrease
No change
Decrease
Increase
Decrease
tion who received no money for solving puzzles spent an average of 190.2
seconds out of the 480 seconds of free-choice time working on the puzzles,
whereas the experimental subjects who received $2 for participating spent
an average of 192.8 seconds. Clearly there is no difference. On the other
hand, in the contingent-payment experiment (Deci, 1972) there was a
significant difference. The control subjects spent an average of 208.4
seconds while the experimental subjects, who were paid $1 for each puzzle
they solved, spent only 108.6 seconds.
The small difference between the control groups in the two experiments
does not even approach significance (t -- .22) and may be due to chance
or to the fact that a different experimenter conducted the two studies.
When payments were made contingent upon performance, the subjects'
intrinsic motivation decreased, whereas when payments were not contingent upon performance, intrinsic motivation did not decrease. These
findings are consistent with the cognitive evaluation theory. When money
is contingent, the subjects are more likely to perceive that they are performing for the money. Their doing the activity is instrumental to their
receiving rewards, so they perceive the rewards as the reason for the
activity. On the other hand, when rewards are noncontingent, performance
is not tied directly to rewards. Consequently, the subjects are less likely
to perceive that the rewards are the reason for their performance.
In summation. The experimental results give suppor~ to the cognitive
evaluation theory which proposes that intrinsic motivation may be affected either through the process of change in perceived locus of causality
or the process of feedback. These experimental results are summarized
in Table 2.
DISCUSSION
To understand the importance of these results for organizations, it is
necessary to distinguish between keeping a person on the job and motivating him to perform effectively on that job. To attract and keep a per-
EFFECTS
OF REWARDS AND C O N T R O L S O N MOTIVATIOI~I
227
son in an organization, it is necessary to satisfy his needs (Ross & Zander,
1957). I-Ie will have to be paid a competitive salary and given other comforts. However, satisfying a worker does not guarantee that he will be
motivated to perform well on the job (Brayfield & Crockett, 1955; Kahn,
1960; Vroom, 1964).
Let us, therefore, consider how payments and intrinsic factors relate
to satisfaction on the one hand and effective performance on the other.
Paying workers is necessary to attract them to jobs and keep them satisfied with those jobs. However, in order to use money as a motivator of
performance, the performance has to be perceived by the worker as being
instrumental to his receiving the money (Vroom, 1964; Lawler, 1971).
This is generally accomplished by making pay contingent upon performance. In other words, it is not the money per se which motivates performance but rather it is the way that it is administered. To use money as an
extrinsic motivator (or controller) of behavior it has to be administered
contingently. However, we have seen that not only are there many difficulties in making such a system work effectively, but also such a system
decreases intrinsic motivation.
On the other hand, a system for motivating employees such as participative management which--through participation and job enlargement-attempts to arouse intrinsic motivation, appears to motivate effective performance at the same time that it satisfies higher-order needs. In fact,
Law]er and Porter (1967) show that effective performance leads to satisfaction, although there may be individual differences in this (Hackman
& Lawler, 1971).
Since advocates of participative management stress the importance of
intrinsic motivation, the earlier experimental results (Deci, 1971, 1972)
which demonstrate that money decreases intrinsic motivation have led
some antagonists to the conclusion that workers should not be paid.
Clearly, such a prescription is absurd for anyone interested in more than
vacant jobs.
The importance of the present noncontingent payment study is that
money does not decrease intrinsic motivation if it is paid noncontingently.
It is possible to pay workers and still have them intrinsically motivated.
Hence, the writer favors the prescription that we concentrate on structuring situations and jobs to arouse intrinsic motivation, rather than trying to structure piece-rate and other contingency payment schemes.
Workers would be intrinsically motivated and would seek to satisfy their
higher-order needs through effective performance. The noncontingent payments (or salaries) would help to satisfy the workers and keep them on
the job especially if the pay were equitable (Adams, 1965; Pritchard,
1969). At the same time the money would help keep the higher-order needs
228
EDWARD L. DECI
s a l i e n t b y s a t i s f y i n g the lower ones (Maslow, 1943; Alderfer, 1971), a n d
in so doing it would n o t decrease i n t r i n s i c m o t i v a t i o n .
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RECEIVED: S e p t e m b e r 23, 1971